S&P cuts National Processing

Standard & Poor's said it lowered the corporate credit rating on National Processing Co. Group Inc. to B- from B and its senior secured term loan and revolver to B from B+ with 2 recovery rating.

The agency also downgraded the company's second-lien term loan to CCC from CCC+ with 6 recovery rating.

The outlook is negative.

"The downgrade reflects our concerns about limited headroom under covenants contained in NPC's bank credit facility," S&P analyst Susan Madison said in a statement.

"Despite NPC's intention to direct substantially all of its discretionary cash flow to debt reduction in 2009," Madison said, "establishing adequate protection under the covenants may be challenging given the current weak economic environment, coupled with additional step-downs in covenant measures at Dec. 31, 2009."

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